Buffalo charges to the top of Zillow's 2024 hottest markets list
- Affordability and job growth are propelling the Great Lakes and Midwest regions to the top of Zillow's 2024 housing market rankings
- Buffalo, New York is expected to be the hottest major housing market this year
- Zillow's analysis takes into account local home value growth, speed of home sales, job growth, and growth in owner-occupied households
- None.
Insights
The recent analysis by Zillow indicating that the Great Lakes and Midwest regions are poised to become the hottest major housing markets in 2024 is a reflection of underlying economic trends. The shift towards affordability, coupled with job growth, underscores a broader movement of population and economic activity to regions with lower living costs. This trend may have significant implications for local economies, potentially stimulating business development and consumer spending in these areas. The correlation between new jobs per new home permitted and housing demand suggests a healthy job market could drive real estate prices and construction, further influencing local and national supply chains.
From a macroeconomic perspective, housing affordability is a key component of economic well-being, influencing consumer confidence and spending patterns. If mortgage rates ease and wage gains continue, as suggested, we could observe a positive feedback loop where increased home buying power leads to stronger consumer demand, which in turn could bolster job growth and economic expansion. This dynamic may also affect inflationary pressures, as housing costs are a significant part of the Consumer Price Index (CPI). However, it's critical to monitor if the supply side can keep up with demand to prevent an overheated market that could lead to unsustainable price increases.
Understanding the nuances of regional housing market dynamics is essential for stakeholders in the real estate industry, including investors and developers. The data presented by Zillow suggests that markets such as Buffalo, Cincinnati and Columbus are experiencing rapid inventory turnover and growing owner-occupied households, which are indicative of a robust housing market. These metrics are valuable for anticipating consumer behavior and planning for future developments.
For businesses operating in the construction and home improvement sectors, such insights could inform strategic decisions on where to allocate resources and expand operations. Additionally, real estate investment trusts (REITs) and other investment vehicles that focus on residential properties might adjust their portfolios to capitalize on these emerging market trends. It's imperative to analyze the long-term sustainability of these trends, taking into account factors such as local economic diversification, infrastructure and potential policy changes that could affect the housing market's trajectory.
From a financial analysis standpoint, the shift towards more affordable housing markets could have implications for the mortgage industry and banking sector. If mortgage rates decline and affordability improves, we may see an uptick in mortgage originations, which could positively impact the financial performance of lenders and mortgage servicing companies.
Investors should consider the potential impact on companies that operate in the regions identified as 'hot markets' for 2024. These companies could benefit from increased consumer spending and a larger workforce. However, it's also important to consider the risk of localized housing bubbles and the potential for regulatory changes aimed at cooling down overheated markets. The long-term performance of investments tied to these regions will depend on the balance between supply and demand, as well as the broader economic environment.
Affordability and job growth push the Great Lakes, Midwest regions to the forefront of the forecast
- The hottest major housing markets in 2024, led by
Buffalo ,Cincinnati andColumbus , will highlight affordability. - Affordability across the
U.S. could improve this year if mortgage rates ease and wage gains continue.
"Housing markets are healthiest where affordable home prices and strong employment are giving young hopefuls a real shot at buying and starting to build equity," said Anushna Prakash, data scientist for Zillow Economic Research. "I'm cautiously optimistic that the housing market will get back on stable footing in 2024 — we shouldn't see the massive price spikes of the early pandemic or fast-rising mortgage rates of recent years."
This ranking of the nation's 50 most populous metros takes into account Zillow's forecast for local home value growth and the speed at which home sellers are entering contracts with buyers. It also considers job growth per new home permitted and growth in owner-occupied households.
Among the front-runners,
Housing costs hit record highs for both buyers and renters in 2023. This made buying and selling an expensive proposition, even for homeowners with plenty of equity. Zillow's most popular markets in 2023 were relatively affordable, and a Zillow study of United Van Lines data shows relocating households were attracted to areas where houses were roughly
Affordability should improve in 2024, but it is still going to be the biggest driver of the housing market. Competition for homes is already high in affordable Great Lakes and Midwest markets. Homes listed in these areas tend to go under contract faster than the national average.
Latest stats for Zillow's hottest markets in 2024
Market | Typical Home Value | Mortgage Payment ( | Typical Rent | Days on Market |
14 | ||||
11 | ||||
11 | ||||
19 | ||||
14 | ||||
26 | ||||
16 | ||||
12 | ||||
23 | ||||
24 | ||||
| 21 |
Methodology
Zillow analyzed the 50 largest
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in
Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, and Spruce®.
All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a Zillow affiliate.
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SOURCE Zillow
FAQ
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